Thursday, March 4, 2010

There is no denying that Stephen Harper’s capricious income trust tax has caused great harm to all Canadians and all Canadian taxpayers. None more so that the 2.5 million Canadians who had the misfortune to take Stephen Harper’s investment advice for the promise it was held out to be, and none more so that the 38% of trust investors who held income trusts in their Registered Retirement Savings Plan, whose rules are subject to wild and capricious government changes without notice. No wonder people don’t put money into RRSPs, as it isn’t safe for fear of what Ottawa might do next, to appease some corporate driven agenda to kill the nest investment choice that Canadians might favour?

Harper’s income trust policy was capricious for the simple fact that it was premised on the complete patent falsehood called tax leakage.

It is very apparent from the complete lack of interest on the part of our elected Members of Parliament, virtually all in the media, the Auditor General and the Parliamentary Budget Office that these people in positions of trust are not to be trusted. None of them. Full stop.

That not so trivial point aside, there does exist a concept on which our society is based called “duty of care” and “duty to mitigate’. It is clear from his capricious actions that Jim Flaherty cares not a moment about the concept of duty of care, which holds that one must conduct oneself in society in a manner that pays fullest regard to what the consequences of those actions are on others. In jim Flaherty’s case he used the patent lie called tax leakage to bring about the known adverse outcome that would have been apparent to anyone involved in that decision, namely Harper, Flaherty, Brodie, Lynch and Carney, that the result would be that 2.5 million Canadians would lose $35 billion of their life’s savings.

Due to the incompetence of Canada’s elected politicians and overseers and virtually all in the media, including the utterly lame CBC, this is all water under the bridge, at least for the time being.

This still leaves the matter of “duty to mitigate” to be dealt with/ The Marshall Savings Plan is that :duty to mitigate” solution and it is leagally incumbent upon the Government of Canada to implement it for that reason and that reason alone.

The Government of Canada, through tax policy, created a set of incentives and disincentives in the system for retirement savings. Think of it as a set of carrots and sticks. The carrot was to create a syatem called RRSPs to encourage people to save for retirement. The RRSP system is grossly flawed in such a way that certain securities are tax efficient to hold in RRSPs and others are not. Those securities that THE GOVERNMENT CHOSE to make efficient by its own set of rules to hold in RRSPs were:

Debt securitiesIncome trusts

What was made to be grossly inefficient by the government’s rules to hold in RRSPs were:

Common shares without dividendsCommon shares with dividends

This is where the concept of :”duty to mitigate comes into play, as the Harper government went about promising Canadians in no uncertain terms that it would never tax income trusts. As a resuly many people piled into income trusts who otherwise would not have, including making those investments in their RRSPs and RIFs etc. Then for completely arbitrary and unproven reasons the Government decided to play “gotcha” with Canadians saving for retirement and turned the whole thing on its head by double taxing income trusts in RRSPs (but not pension funds) at 31.5% on top of the 38% tax the government was already getting on income trusts in RRSPs for a double tax.

The whole intent of the trust tax was to kill an investment vehilce that Canadians favored and that was perfect to hold inside an RRSP. No surprise then that 38% of all income trusts reside in RRSPs and that RRSPs are the place that is getting nailed with the 31.5% tax, whereas taxable accounts are not, since the whole nefarious intent of the policty was not to “level the playing field’, but rather to destroy it on behald of the selffish greed that is advanced by the members of the CCCE.

Still there is the issue of “duty to mitigate” as what was once a wise and prudent decision to hold income trusts in RRSPs, in response to the carrot and stick tax rules of the government, overnight became the worst possible security to hold within RRSPs.

Was the purpose of the so called Tax Fairnesss Plan to punich those Canadians who had acted in full accordance with the Government’s wishes and to destroy people’s retirement savings? If the answer to that is “yes”., then there is no need for the Marshall Savings Plan. If however the answer to that is no, then there is an absolute need on the part of all elected Members of Parliament to call upon the Government to implement the Marshall Savings Plan for the simple fact that government had no less an obligation to “mitigate the damages” it has caused that I do as a citizen.

Therefore the question for Flaherty and Harper, along with Ignatieff Layton and Duceppe is: “What are you going to do to mitigate the damagaes that the Government of Canada has inflicted on innocent law abiding Canadians saving for retirement that you caused when you whipsawed tax plocy that was one minute headed north and then took a complete 180 and started heading south, with innocents holding the bag”?

You have a legal obligation to implement the Marshall Savings Plan to mitigate the damages you have caused, especially since the Marshall Savings Plan achieves ALL of the ostensible reasons that you claim you original policy was premised upon, namely addressing alleged tax leakage, all of which is resolved by the Marshall Savings Plan.

So now what is your excuse? Another bull shit article in the Globe and Mail entitled “Flaherty’s trust tax no so scary after all”, which only serves to make the very point about the need for the Marshall Savings Plan. What kind of gutless and unaccountable politician are you, when you have the very people who put you up to this absurd policy write articles in their media publications that attempt to rationalize your irrationality that was borne out their original greed and your gullibility and total incompetence and deceit.

Notwithstanding your total incompetence and deceit Mr Flaherty. You too have legal obligation in society to mitigate the damage you have caused, given that you so totally disregarded your duty of care in the first place. Stop hiding under the skirt of the protective media and defend your actions like a man, instead of the spineless puppet we all know you to be. The rest of the politicians in Ottawa have hardly shown themselves to be much different than you, as I think you have all sold your souls to the same crowd of crooks and villians.

Does this country even have political leaders, or all you all a bunch of followers, dancing to the tune of big business and the so called media moguls they control?

EVENTS

Income Trust Halloween VigilThanks to all who participated in both the Ottawa and Calgary vigils to mark the anniversary of the announcement.

WE"D LIKE SOME ANSWERS

As you well know, the ‘income trust thing’ has grown beyond the
question of whether fair taxes are paid on income from trusts. It’s
become a giant dirty snowball, and as it rolls forward it accumulates
more and more bulk. There are so many unanswered questions. Let's list a few and invite our "Accountable" government and our free press to provide some much-needed answers.

It is said “Trusts are inefficient use of capital. Why?” Two
related questions are ‘Whose money is it, anyway?’, and ‘Do Canadian
investors have a free and efficient market?’

How can information that is already in the public domain at SEDAR
make for a state secret? How could such information be used to harm
the Canadian national interest? And who would cause the harm?

Why won’t the Canadian media investigate the falsehoods and
misrepresentations told by the Minister of Finance to a committee of
Parliament? Was the Minister in contempt of Parliament?

Why won’t the Canadian media report (a) government tax revenues
gained from BCE in 2006 when BCE was a corporation to (b) government
tax revenues that would be gained in 2007 from BCE, if BCE had been
allowed to proceed to a trust, and (c) government tax revenues that
will be gained in 2007 from BCE, when BCE ownership has been carved
up as 45% foreign ownership and 55% large Canadian pension fund
ownership?